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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: bits who wrote (59843)	8/13/2006 12:44:12 PM
From: David Bogdanoff	Read Replies (2) \| Respond to of 306849

Bits; As John Bogle, founder of the Vanguard funds, recently pointed out in, individual invseting is down sharply over the years, from around 50% to 30% or less as I recall. He laments this development and discusses it at length, and the causes for it. there are numerous new financial tools and investment vehicles which allow high profits for hedge funds and private equity groups and high wealth individuals. For instance, the Carlyle group, long making money for wealthy and well-connected individuals through defense industry investments, is now going into the hedge fund business where it would be easy for them to use information from the private equity investment activities to benefit the hedge fund investments. This is explained in detail in the following linK: sfgate.com Incidentally, hedge fund gains are quite high, typically 20% or higher, and there are thousands of them. With them skimming the cream, now much is left for the individual investor? Of course, they are not perfect; recently one rent bankrupt. However, they are under pressure to make high profits each and every year, else investors pull their plug rather than pay their high fees. Investors are no longer think buy and hld. Trading costs have been reduced which facilitates frequent trading. This also means that brokers hold less inventory to "cushion" market swing in individual stocks. the end result is more volatility, according to Jim Cramer. Cramer has also pointed out that some stocks, including AAPL, that don't give guidance or pay dividends, are subject rumors by bear raiders. I believe this drove apple's stock down to the low 50's before its quarterly report made public the strong Mac sales. The stock popped immediately on the news. Ironically, the process seems to be starting over again, the difference being that the worrisome "news" are the options instead of the ipod sales. The readers of this thread had better information and were able to profit from it. As you said, the market is very complex. Bogtalk